OCC Takes Action to Clarify Fee Authority and to Preempt Illinois Limitations on Swipe Fees and Transaction Data

The OCC recently issued an interim final rule to clarify its position that national banks may charge interchange fees for payment card transactions pursuant to their longstanding powers under federal law to assess non-interest charges and fees.  The interim final rule further explains that such charges and fees may be assessed even when set by a third party.

Additionally, the OCC issued an interim final order to establish that federal law preempts key provisions of the Illinois Interchange Fee Prohibition Act (IFPA) with respect to national banks and federal savings associations.  Set to take effect July 1, 2026, the IFPA would have restricted interchange fees on the tax and gratuity portions of credit and debit card payments and limited the use of payment card transaction data.

The OCC’s action comes on the heels of a February 2026 decision in the U.S. District Court for the Northern District of Illinois, which has since been appealed to the Seventh Circuit, wherein the District Court concluded that the IFPA restrictions do not conflict with federal law (see prior coverage here). 

In the interim final order, the OCC noted that the IFPA provisions could “create significant uncertainty for consumers and impose incredible operational challenges for national banks and other participants in the nation’s card networks.”  The OCC also noted that state laws, such as the IFPA, could lead to a “patchwork effect” that would “undermine the uniformity necessary for the functioning of the nation’s payment card systems.”

The interim final rule and the interim final order are effective June 30, 2026, just before the IFPA’s scheduled implementation.  Comments to the rule and order must be received by May 29, 2026.